Car insurance can feel like a huge chunk out of your budget when you’re a young driver. And with many options available, finding the right young driver insurance can feel overwhelming.
You might be considering your options whether you feel that it’s worth paying for a full year or whether you’re better off getting cover when you need it. Here is a breakdown to help you figure out which option works best for you.
Flexibility
Short-term insurance can give you more flexibility with your vehicle, this can be handy if you don’t drive as often. You can choose a policy for just a few days, weeks, or months. This type of flexibility can be useful if you plan to borrow a friend’s car and if you only use your vehicle occasionally.
An annual policy, on the other hand, locks you in for the whole year. It’s great if you’re going to be driving regularly and want the peace of mind that comes with knowing you’re covered. But if your circumstances change and you find yourself driving less, you’re stuck paying for a full 12 months of cover.
Upfront cost
It makes sense to compare how much you’ll have to pay with each option, as premiums cost significantly more for young drivers. When you get short-term insurance, you only pay for the time that you’re covered, which can feel like the better deal if you don’t drive as much. But those daily or weekly cost can add up if you do start using your car more frequently.
Annual policies usually require a larger upfront payment, but when you think of it realistically, it is often cheaper than having to pay for a short-term cover every time that you need it, as you have the annual policy in place already. This can save you a lot more money and plus you may get discounts if you choose to renew or if you don’t make any claims.
No Claims BonusIncome received as a bonus, which may affect a borrower's ab... (NCB)
A big perk of an annual policy is the chance to build up a No Claims Bonus. You can get discounts on your premiums ,if you’re a careful driver once it is time to renew. This can be helpful for young drivers, as it can help bring down the costs over time.
Short-term policies don’t give you the chance to build an NCB, so you won’t see those long-term savings. But, if you’re only going to be driving for a short period, it might not be a dealbreaker.
Which option is right for you?
In the end, it all does come down to how often you drive and what works for your budget. If you’re behind the wheel often, then an annual policy works out as the best option, as it offers consistency and can save you money in the long run. Plus you’ll be at an advantage of being able to build an NCB , which can reduce your premiums when you renew.
But if you choose to drive less than often, a short-term insurance plan is the better choice, giving you the flexibility to pay only for what you use and allows you to not feel tied down into a full year.
